Today's big stories

Investment bank JPMorgan reported better-than-expected results
Investors are wondering why traditional portfolios just aren't working any more – Read Now
As China imposed sanctions on a major US company, the UK made life difficult for one of China’s

1/3

Hot Pursuit

What’s Going On Here?

It ain’t called JPMorgan Chase for nothing: the investment bank doggedly held its pace during the worst of the coronavirus crisis, and it reported better-than-expected second-quarter earnings on Tuesday.

What Does This Mean?

JPMorgan’s quarterly revenue and profit came in higher than investors expected. That was thanks to the company’s trading and debt issuance segments, which were respectively boosted by market volatility (as stocks bounced back in April) and by companies selling new bonds while the going was good. That even offset the drag on earnings caused by the greater-than-expected amount of cash JPMorgan had to put aside for potential loan losses.

There was a similar story across Wall Street: rival Citigroup’s second quarter was better than expected thanks to a strong showing from its trading business – and despite weakness in its bigger consumer banking segment.

Why Should I Care?

For markets: Everything’s coming up JPMorgan.
At the end of last quarter, JPMorgan warned that this quarter would be the worst of the pandemic – meaning investors might be expecting things to get even better from here on out. But exactly how much better comes down to a couple of factors. For one, it depends whether excitable investors will keep chopping and changing their portfolios, in turn boosting JPMorgan’s trading business. And for another, it depends on the wider economy: if US unemployment stays above 10% until next year (like JPMorgan’s predicting), individuals and businesses will be less likely to pay back their loans.

The bigger picture: Not all banks.
JPMorgan has one of the biggest trading businesses out there, so it’s perhaps no surprise it benefited more than its competitors. And that difference might explain why JPMorgan’s stock rose 1% while Citigroup’s fell 2% (tweet this). Rival Wells Fargo announced results too, revealing its first quarterly loss since 2008 and cutting its dividend by more than expected – and investors sent its shares down 5%.

Recommended: How one bank controls all the others.

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2/3 Premium

Breaking With Tradition

What’s Going On Here?

A “60/40 portfolio” is a classic asset allocation strategy, but with the combined outlook for equities and bonds looking poor, our analysts have identified other assets you might want to consider…

Get the full story with Finimize Premium

🍷 Raise a glass to Vinovest

With markets going through a whole thing right now, it’s never been more important to diversify your portfolio. And Vinovest have a little something to wet your whistle.

With Vinovest, you’ll get access to a portfolio of fine wines, an alternate asset class that’s outperformed the S&P consistently over the past 35 years. In fact, the Vinovest 100 Index has achieved 6.1% growth year to date – and outpaced the key US index over the last two decades.

That’s an investment that’ll go down nice and smoothly: check out Vinovest today.

Find Out More

3/3

Nobody Move

What’s Going On Here?

As the Chinese government threatened US arms dealer Lockheed Martin with sanctions on Tuesday, the UK wasn't afraid to pull the trigger on one of China’s weak spots...

What Does This Mean?

China’s beef stems from a deal Lockheed struck with Taiwan to sell the country $620 million worth of arms parts. China considers Taiwan one of its territories, and asked the US to block the agreement in an effort to keep already-strained US-China relations on an even keel. But when the US instead gave Lockheed the thumbs up, China said it’d sanction the company – a damaging move given that Lockheed made 10% of its revenue in Asia last year.

But China has its own back to watch. The UK followed in the US’s footsteps on Tuesday by banning the use of telecoms equipment from Chinese giant Huawei as the country upgrades to 5G, as well as mandating the removal of existing equipment over the next few years.

Why Should I Care?

For markets: The 3310’s still got it.
Huawei’s loss could be telecoms investors’ gain. With the company left out of the UK’s 5G upgrade, British telecoms operators will be forced to buy equipment from more expensive – but arguably more secure – providers, or else risk missing out on the 5G revolution. That’d put Huawei’s previously cut revenue forecast even more at risk next year, but it could be good news for Nordic rivals Nokia and Ericsson, whose equipment – with the potential exception of Snake – might see a surge in demand.

The bigger picture: Anything but the gin...
Europe’s still playing its part in global tensions too. Its courts are set to decide this week whether to uphold a $15 billion tax levied against Apple, while France and the UK have announced “tech taxes” aimed at America’s biggest companies. The latter haven't gone down well: the US has threatened to retaliate with trade taxes on European leather, olives, and gin. Tonic’s safe, though.

Take action: How you can profit from telecoms disruption.

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🙋 Ask a question

💬 Quote of the day

“Let go of who you think you’re supposed to be. Embrace who you are.”

– Brené Brown (an American professor, lecturer, author, and podcast host)

Tweet this

🤔 Q&A · RE: Carte Blanche

“What’s the difference between a Special-Purpose Acquisition Company (SPAC) and a Special-Purpose Entity (SPE)?”

– Matt in Texas, USA

“A SPAC is a tried-and-tested investment vehicle that lists on the stock market in order to raise money from public investors. It has no revenue or profit of its own and only exists to find a (usually private) company to merge with and effectively morph into. SPEs, on the other hand, are legally separate subsidiaries created to keep a certain set of risks or actions at arm’s length from the often-larger parent firm. While a completely legitimate practice, those kinds of structures were also infamously used in Enron’s later-exposed accounting scandal.”

🙋 Ask a question

🍷 Discover fine wine investing

Everyone knows you can invest in stocks or bonds, but how about something for those with a more discerning palate: wine.

Our sponsors at Vinovest give you access to an investment-grade, globally diversified portfolio of fine wines. And we mean “fine” in every sense of the word: Vinovest don’t just pick wines they like, they use proprietary financial models and historical data to pick a balanced portfolio of wines that’ll perform.

It’s why their portfolios deliver more consistent returns than gold and cryptocurrency. The Vinovest 100 Index has even grown 6.1% year to date, as well as outpaced the key US stock market over the last two decades.

Or if you’d rather just enjoy the wine for yourself, you could always just have Vinovest send it to you…

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🌎 Finimize Community

👋 Meet Hayley and Ryan

This week, Hayley’s running a discussion about how COVID-19 has changed the way Germans pay, while Ryan’s leading a chat on how to protect your intellectual property in times of uncertainty. So when Hayley and Ryan go on to do amazing things, remember you heard their names here first, okay? We’ll be taking all the credit, thanks.

🇩🇪 Germany: Is Cash Still King in Germany? – 3pm Berlin Time, July 15th
🇺🇸 USA: IP Risk During A Pandemic – 11am New York Time, July 15th
🇺🇸 USA: How To Build An Anti-Racist Startup – 1pm New York Time, July 16th
🇺🇸 USA: What’s Next For Streaming? – 12pm New York Time, July 20th
🇬🇧 UK: Global Economic Outlook – 5pm UK Time, July 21st
🇦🇺 Australia: Women & Money (in-person) – 5.30pm Perth Time, July 22nd
🌎 Global: Finimize Live AMA – 1.30pm UK Time, July 28th
🇨🇦 Canada: Searching For Financial Stability – 1.30pm Pacific Time, July 28th
🇬🇧 UK: What’s Next For The Global Economy? – 6pm UK Time, July 29th
🇬🇧 UK: The Bright Future for Renewable Energy – 12pm UK Time, July 30th

📚 What we're reading

Prepare your doggo for a break-up (BBC)
Get up close with a sunken ship (Aeon)
How do you become a conspiracy theorist anyway? (The Atlantic)

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Finimize - 🏦 JPMorgan is the best bank ever

Today's big stories

Hot Pursuit

What’s Going On Here?

What Does This Mean?

Why Should I Care?

Breaking With Tradition

🍷 Raise a glass to Vinovest

Nobody Move

What’s Going On Here?

What Does This Mean?

Why Should I Care?

🍷 Discover fine wine investing

👋 Meet Hayley and Ryan

Older messages

📉 China tanks stock market

🧐 Goldman predicts the US election

⏰ Jack Bauer’s 4 billion deal

🤫 Palantir's secrets revealed

🤨 Buffett bets on fossil fuels

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